1. SUMMARY: FORMER PRESIDENT ECHANDI HAS PRODUCED DOCUMENTS ALLEGEDLY SHOWING THAT ROBERT VESCO GAVE 150,000 COLONES TO EX-MINISTERS IN FIGUERES ADMINISTRATION FOR THE GOVERN-MENT PARTY (PLN).

PLN TREASURER RODRIGUEZ HINTS MONEY MAY HAVE BEEN GIVEN TO ONE OF THE PARTY'S FACTIONS (I.E. FIGUERES) BUT DENIES THAT PARTY RECEIVED IT.

ECHANDI'S CHARGE REPRESENTS THE FIRST OPPOSITION SALVO ON THE VESCO/ CORRUPTION ISSUE IN THE 1978 PRESIDENTIAL ELECTION CAMPAIGN, AND RODRIGUEZ' RESPONSE GIVES FIRST INDICATION OF HOW PLN WILL ATTEMPT TO HANDLE IT. END SUMMARY.

2. FORMER PRESIDENT MARIO ECHANDI CHARGED IN A NATIONWIDE T.V. BROADCAST FEBRUARY 4 THAT IN MARCH 1976, ROBERT VESCO DONATED 150,000 COLONES (17,564 DOLLARS) THROUGH FORMER MINISTER OF AGRICULTURE (FIGUERES ADMINISTRATION) FERNANDO BATALLA TO THE NATIONAL LIBERATION PARTY (PLN).

THIS MONEY WAS ALLEGEDLY PASSED BY BATALLA TO FORMERM FIGUERESMINISTER OF FINANCE CLAUDIO ALPIZAR VARGAS.

ECHANDI PRODUCED PHOTOSTATIC COPIES OF A CHECK FROM BATALLA TO ALPIZAR FOR 150,000 COLONES, ALPIZAR'S RE- LIMITED OFFICIAL USE

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CEIPT FOR THIS "CONTRIBUTION FROM FRIENDS," AND A MEMO TO ROBERT VESCO FROM BATALLA WHICH DECLARED "ATTACHED IS PHOTOCOPY OF CHECK SENT TO DON CLAUDIO ALPIZAR AND HIS RECEIPT FOR THE SAME" TO SUPPORT HIS ALLEGATIONS.

3. THE STORY WAS PICKED UP BY OPPOSITION DAILY LA REPUBLICA, FEBRUARY 6 AND GIVEN EXTENSIVE COVERAGE. THE THREE DOCUMENTS CITED BY ECHANDI WERE REPRODUCED. SO FAR BATALLA AND AGHGZAR HAVE NOT RESPONDED TO THE CHARGES.

4. PLN TREASURER EUGENIO RODRIGUEZ VEGA DENIED KNOWLEDGE OF ANY DONATION FROM VESCO TO THE PARTY, BUT NOTED HE COULD NOT RESPOND FOR PERIOD PRIOR TO JUNE 1976, WHEN HE BECAME TREASURER.

SIGNIFICANTLY, HE DID NOT REFUTE ECHANDI'S CHARGES. INSTEAD HE STATED THAT THIS COULD BE A PERSONAL MATTER AMONG THE INDIVIDUALS INVOLVED, OR POSSIBLY A CONTRIBUTION TO ONE OF THE "FACTIONS" WITHIN THE PLN.

IMPLICATION IS CLEAR THAT IT WOULD BE FIGUERES'; ALPIZAR WAS TREASURER OF FIGUERES GROUP'S EFFORT A YEAR AGO TO FORM THEIR OWN PARTY TO PUSH FOR CONSTITUTIONAL REFORM (TO PERMIT FIGUERES TO RUN FOR PRESIDENT AGAIN IN 1978).

5. SUBSEQUENT TO ECHANDI'S CHARGES, BOTH HERNAN GARRON AND GONZALO FACIO DENIED THAT THEIR CAMPAIGNS HAD RECEIVED VESCO MONEY.

LUIS ALBERTO MONGE, CAMPAIGNING OUT OF TOWN, COULD NOT BE REACHED FOR COMMENT.

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6. COMMENT: ECHANDI'S REMARKS REPRESENT THE FIRST SALVO IN THE OPPOSITION'S CAMPAIGN TO MAKE VESCO-RELATED VES PTION#A MAJOR ISSUE IN THE 1978 PRESIDENTIAL ELEC-TION.

RODRIGUEZ' RESPONSE INDICATES THAT THE MONGE LIMITED OFFICIAL USE

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FORCES AND THE PLN INTEND TO TURN ASIDE SUCH CHARGES BY DISASSOCIATING FROM THOSE SO ACCUSED. IT IS EVEN MORE: BY LEAVING TWO LEADING FIGUERISTAS HOLDING THE BAG, THE GOVERNMENT PARTY IS POINTING STRAIGHT TO THE VESCO-FIGUERES CONNECTION TO EXPLAIN AWAY THE OPPOSI- TION'S CHARGES.

THIS COULD BE DANGEROUS POLITICAL BUSINESS IN TERMS OF PLN UNITY, BUT HERE APPEARS TO BE NO OTHER WAY FOR THE PARTY TO HANDLE THE VESCO/CORRUPTION CHARGE AND MAINTAIN CREDIBILITY ON THIS ISSUE.

1. LA NACION OF SEPTEMBER 13 CARRIED AN INTERVIEW WITH CLAUDIO ALPIZAR VARGAS WHO HAS JUST RESIGNED AS EXECUTIVE PRESIDENT OF THE CENTRAL BANK.

IN THE COURSE OF THAT INTER- VIEW THE SUBJECT OF ROBERT VESCO'S HOLDINGS OF GOVERNMENT BONDS WAS RAISED AND ALPIZAR RESPONDED THAT THE GOVERNMENT HAD RE-PURCHASED THOSE BONDS AT THE END OF 1973.

2. THE REMARKS REPORTED ARE AS FOLLOWS (FREE TRANSLATION): INTERVIEWER: "DON CLAUDIO, IT HAS BEEN AFFIRMED THAT A LARGE PURCHASE OF GOVERNMENT BONDS WAS MADE BY FINANCIER ROBERT VESCO WHICH RESULTED IN AN IMPORTANT INFLOW OF FOREIGN CAPITAL.

THESE BONDS HAVE SINCE COME DUE FOR RE-PURCHASE AND THIS FACTOR COULD HAVE INITIATED THE LOWERING OF OFFICIAL RESERVES WHICH HAS OCCURRED.

COULD YOU COMMENT ON THIS?" ALPIZAR: "THESE BONDS ARE THE ONES PURCHASED BY THE BAHAMAS COMMONWEAPRH (BANK) BUT SINCE BEFORE I LESU THE MINISTRY OF FINANCE THEY HAD BEEN RE-PURCHASED. THIS OCCURRED AT THE END OF LAST YEAR, AND THUS DID NOT HAVE MUCH OF AN INITIATING EFFECT (ON THE DROP IN RESERVES)."

1. SINCE EMBASSY SENT REFTEL (A) CLAUDIO ALPIZARHAS RESIGNED FROM HIS POST AT THE CENTRAL BANK (SEE REFTEL (B). CONSEQUENTLY, HE WILL NOT BE ATTENDING THE SEPTEMBER 30 - OCTOBER 4 MEETING. THE COSTA RICAN DELEGATION TO THE MEETIODS WILL BE HEADED BY PORFIRIO MORERA, MINISTER OF FINANCE, WHO APPARENTLY WILL SERVE AS THE CHIEF OF DELEGATION TO BOTH MEETINGS. MORERA IS THE COSTA RICAN GOVERNOR TO THE IBRD. JOSE MARIA MUNOZ, AN ADVISOR TO MORERA AT THE FINANCE MINISTRY, WILL ATTEND AS TEMPORARY ALTERNATE GOVERNOR TO THE IBRD. GUILLERMO GONZALEZ, THE DIRECTOR OF THE ECONOMIC STUDIES DEPARTMENT AT THE CENTRAL BANK, WILL ATTEND AS TEMPORARY ALTERNATE GOVERNOR TO THE IMF.

NEITHER THE UNCLASSIFIED UNCLASSIFIED

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NEW CENTRAL BANK EXECUTIVE PRESIDENT, BERNAL JIMENEZ, WHO IS COSTA RICAN GOVERNOR TO THE FUND, NOR THE MANAGER OF THE BANK, ALVARO VARGAS, WHO IS ALTERNATE GOVERNOR TO THE FUND, WILL ATTEND. THE COSTA RICAN DELEGATION WILL ALSO INCLUDE ANOTHER BANK EMPLOYEE, MR. CARLOS FORMOSO.

2. THE EMBASSY HAS DELIVERED SECRETARY SIMON'S LUNCHEON INVITATION TO MORERA, MUNOZ, AND GONZALEZ. LATTER HAS CONFIRMED HE WILL ATTEND. OTHERS EXPECTED TO CONFIRM AFTER ARRIVAL WASHINGTON.